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Paraguayan Senate approves reform to raise capital requirements for banks, other entities

Paraguay'ssenate on March 31 approved a reform of the banking law to raise the minimum capitalrequirements for banks and other financial institutions, according to a statementon the senate's website.

The aimof the new norm is to strengthen the financial system and, among the changes, theboard of the Banco Central del Paraguaywill have the power to decide which non-bank financial entities will or will notbe regulated by the new norm.

The minimumcapital requirement for banks will be increased to 50 billion Paraguayan guaraníesfrom 10 billion guaraníes, while the minimum requirement for other financial entitieswill rise to 25 billion guaraníes from 5 billion guaraníes.

The centralbank's board will also have the power to increase these requirements according tothe new law.

As of April 1, US$1 was equivalentto 5,626.07 Paraguayan guaraníes.